#10 Fail to Engage – Top 10 Reasons Why Procurement Fails
In this series, I will be introducing the top 10 reasons why Procurement fails. Why failing? Why not, succeeding? There are many successes to be celebrated, however, in my experience, many of my best, hard earned lessons, were from failing. Either my own personal failure or a failure I observed as a leader or member of a team, which can often be more painful. What is most important is how you react to failure and what lessons you learned from those failures. I like the saying “fail-forward” and truly believe you must fail and fail often so that you can become better and continuously learn. In that spirit I share with you the top 10 reasons why procurement fails and the lessons we can learn.
#10 Fail to Engage Stakeholders
Engaging with stakeholders is something many procurement professionals shy away from or wait until the strategy is complete. Often, they think they need to develop some shiny and perfect strategy or proposal before they will be taken seriously. Too late! “Involvement fosters ownership”, my old boss at Rogers Communications; Don Moffatt use to say. Engaging Stakeholders early in a procurement, strategic sourcing or project management initiative, is critical. This is not a one and done activity but rather an ongoing continual process. Stakeholders must be engaged throughout the initiative, whatever that may be, or you will fail before you barely begin.
So, what do I mean by engaging stakeholders? In procurement, when developing a category strategy, running a competitive bid, negotiating a contract or creating a supplier management program; (the procurement initiative), there is always a stakeholder(s), within the business, that is responsible for and is dependant upon that initiative, project, product or service, to do their job. Drawing from my own experience, because my team and I were responsible for sourcing and managing IT contracts, relationships and solutions, my primary stakeholders were within the IT department. However, they were not the only stakeholders who were dependant upon the technology or supplier. Often the business unit who used the technology, say software, as an example, were also key stakeholders and needed to be engaged, in addition to the IT department, so they could provide their input. Using the software example, if I were to work only with the IT department and not include Finance when sourcing new financial software, then how would I know what features or functionality is a “must have” for the Finance department to do their job? Conversely if I spoke only to Finance, I might contract for software that must run on internal servers only to find out later that IT’s strategy is to move to the cloud, and I should have negotiated a SaaS (Software as a Service) contract.
Any procurement initiative should always begin with engaging stakeholders, all stakeholders, from within the business or functional areas, from the moment you are assigned the initiative.
Ok, so now what? I’ve identified my stakeholders, and I booked that first meeting. What do I do now?
Ask for input and listen:
- What are their business goals and priorities?
- How does the project or what you are sourcing, impact those goals and priorities?
- What’s important to them and how do they see you helping them?
- What role will they be willing to play?
- What do they see as your role?
- What is their advice on how things need to be done?
- What does success look like for them?
- What impact will failure have on them?
- What contingency plans if any need to be in place?
- Work together on timelines and collaborate on a high-level project plan to meet everyone’s needs.
Stakeholders need to know you are hearing them and are really listening. After the meeting send a follow up email thanking them for the meeting, confirm what you heard and what you agreed were the next steps. Setup regular check point meetings with them. Remember, engagement should be ongoing not just one and done. How often, where and how you meet is dependant upon the stakeholder and how important what you are doing is to them. Is monthly sufficient for them, via a phone call or is it better to meet in person weekly due to tight timelines and the critical nature of the project? How do you know? ASK!
Building a trusting relationship takes time and is the foundation of success
Building trust means you actively listen and take their advice into consideration. You must truly have they’re and the company’s best interests at the heart of what you do. Always hold your discussions in confidence and do not disclose information to anyone, especially suppliers. Follow through on commitments and do what you say you will do. When you can’t, let them know and why. To be trusted, you must be trustworthy.